Brea Mayor Charged on 21 Counts : Complaints: Ronald E. Isles is accused of misdemeanor activity in which he allegedly violated conflict-of-interest and financial-disclosure laws.

Mayor Ronald E. Isles was charged Tuesday with 21 misdemeanor counts alleging that he violated conflict-of-interest laws by casting votes on issues involving a longtime business partner and failed to disclose millions of dollars in loans and other financial interests.

Many of the criminal charges focus on Isles’ business ties with Don McBride, owner of McBride Development Co. of Brea.

Isles, 54, an attorney, and McBride until recently had a partnership which built a 122-unit apartment complex and business park in Brea.

The criminal complaint caps a one-year investigation of Isles by the Orange County district attorney’s office, which was acting on tips from an unnamed Brea resident who complained about his business practices.

Isles on Tuesday denied any wrongdoing, saying that he had gained nothing personally from his decisions as a City Council member.

“I didn’t knowingly and willingly violate the law, and nobody’s ever going to prove I did,” Isles said. “I might have inadvertently not reported something, or voted on something, but that’s the long and the short of it. . . . If any irregularities occurred, they were inadvertent or oversights. Maybe I’m guilty of ignorance, but I’m certainly not guilty of being a criminal.”

The complaint alleges that Isles, on three different Brea development issues, “willfully and unlawfully . . . attempted to use his official position to influence a governmental decision in which he knew . . . he had a financial interest.”

Deputy. Dist. Atty. James Mulgrew characterized the charges “as a very serious matter. We interviewed dozens of people and reviewed hundreds of documents.”

Isles said he ended his financial involvement with McBride when he was elected to the council. He said he sold back to McBride in 1988 his 50% financial interest in their partnership, called Town and Country Partners, although he continued to keep his name on the partnership for tax reasons.

“On each and every incident, it can be clearly shown I had no profit to gain whatsoever,” Isles said.

The prosecutor, however, said that despite some 1988 changes in the partnership, “there still existed an intricate financial relationship between him and Mr. McBride after he entered office,” Mulgrew said.

If convicted, Isles could face six months in jail and maximum fines of $10,000 per count.

At a council meeting Tuesday night, the mayor said he had been asked if he intended to resign. “The answer is no. I am not guilty of misdemeanors, which would imply some intent. I never willingly violated the laws, and all those who know me know that . . . ,” he said.

Isles, who was elected in 1988, also was asked if he would run for reelection in November.

“The answer is a resounding yes,” he said.

But Drew Imler, a member of the Brea Small Business Coalition and a critic of Isles, said: “This is the final straw in his political career. This is the end of him, and it’s about time.”

Isles was first elected to the council in 1980, then resigned in 1983 because, ironically, he feared that his partnership with McBride might violate state conflict-of-interest laws.

City Manager Frank Benest said that the charges against Isles would have little effect on the city or its government.

“This is a matter between Mr. Isles and the district attorney,” Benest said. “The city and the Redevelopment Agency are not parties to this, and we are going to continue moving ahead.”

Isles isn’t the only Brea councilman under investigation. The district attorney is still investigating unrelated, conflict-of-interest issues involving Councilman Wayne D. Wedin and his role in helping the Keith Companies of Costa Mesa, an engineering firm, win a city contract to study the best ways to develop a six-square-mile area of Tonner Canyon.

Mulgrew said no conclusion has been reached in the Wedin investigation.

Of the 21 counts filed against Isles, 10 alleged conflict of interest. Included are four counts that focus on the city’s granting of a contract giving McBride Development the exclusive right to negotiate to build an auto service center on a 7.5-acre city-owned parcel at Brea Boulevard and Cypress Street.

Isles, as a city councilman, took part in the discussions and then abstained, citing no reason, in a March 6, 1990, vote.

However, when the council needed more time to negotiate and renewed the contract with McBride on Oct. 16, 1990, Isles was among the council members approving it along with other items on the consent calendar. When controversy erupted over McBride’s ties with Isles a year ago, the city withdrew from the contract.

“They allege I participated in the negotiations with Don McBride. My comment is I did not represent him in that effort. I didn’t own even a scintilla of interest in the project, and I have no way in the world of defining how I could have financial gain,” Isles said.

Isles maintained that his partnership with McBride was “in name only” at the time.

“Looking back, I can see where I shouldn’t have been involved at all (in the vote). Back then it didn’t appear to me to be a conflict,” he said. “It felt OK to me because I knew I had nothing to gain either way. I was just doing what was best for the city.”

In a separate interview Tuesday, McBride said he has had no financial ties with Isles since 1988, when he paid Isles $1.4 million to buy his half of Town and Country Apartments.

“He was totally out of that partnership for all intents and purposes. But he did request that the partnership continue in name only because he had some tax advantages that way,” McBride said. McBride has sued the city, seeking $100,000 in costs, because the city pulled out of the auto center contract.

Isles and McBride said Isles kept his name on the partnership because Isles did not want to have to report the sale as income in tax filings at that time.

McBride added that “the whole town knew” about his partnership with Isles, which he said officially dissolved a few months ago. “He never hid the fact that he and I did a couple projects together in Brea,” he said.

Four other conflict-of-interest counts focus on Isles’ votes on Olen Properties Inc. development projects in 1989 and 1990. The district attorney says Olen Properties made a $925,000 loan to Isles and McBride in late 1988, so Isles knew he had a financial interest in matters involving the company when he voted on issues related to its projects.

Isles said McBride received that loan and that his only role was “to sign the note because my name is on the partnership.”

Two other counts alleging illegal conflicts involve Isles’ ownership of three parcels in the city’s redevelopment area--one of the parcels is the site of Town and Country Apartments, Mulgrew said. Isles said Tuesday that he doesn’t believe any of the properties he owns is within that area.

The remaining 11 counts charge Isles with failing to report some of his financial interests in state economic disclosure forms in 1989 and 1990, including property at 595 W. Lambert Road and 409 W. Date St., and five loans of almost $7 million.

Isles said most of those loans involved Town and Country Apartments, and since McBride made the payments and arranged them, he mistakenly left them off his economic disclosure forms.

“Twenty-one counts sounds ominous, but you might find 21 errors in everyone’s reporting forms,” Isles said. “If I’ve got egg on my face, and I didn’t pay enough attention to reporting, it’s because it wasn’t on my mind. I am a busy individual.”

In the conflict-of-interest charges, the district attorney, under the state’s Political Reform Act, must prove a financial link between Isles and the decisions he made as a city councilman, but not a direct financial profit.

Profile: Ronald Eugene Isles

Age: 54

Born: Terre Haute, Ind.; moved to California in 1960; a Brea resident since 1970.

Family: Wife, Joy; five children.

Education: Western State University, JD.

Government service:

Member, Brea Planning Commission 1974-1978.

Elected to Brea City Council in 1980, appointed mayor 1982, resigned 1983.

Reelected in 1988; appointed mayor for one-year term in 1991.

Defeated in Republican primary February, 1990, to fill vacancy in state’s 31st Senate District.

Also:

Founder, Isles Industries, an electronics industry equipment manufacturer (sold mid-1980s).

General Partner, law firm of Ronald E. Isles & Associates.

Partner, Town & Country Partners, with Don McBride. Isles maintains that he has had no financial interest in the partnership since 1988, when he rejoined the council.